Hot on the heels of the news that Fubo Sportsbook was ceasing operations, another online betting company is pulling out of New Jersey. Esports betting platform Vie.gg, owned by Esports Entertainment Group, announced it is shutting down global operations, which includes sites in Spain, the UK, and the Garden State.
The company sent the following notice to its customers:
“Dear Patron. We have made the difficult decision to close Vie.gg. The site will remain open until November 1, 2022. Until then, you will be able to log in to close your account,” read the email to customers.
Any accounts remaining open at that date will automatically be closed and any remaining balances of $1 or more will be returned by check sent to the address registered on the applicable account.”
That gives users until just the following Tuesday to clear out their accounts. The closure could open up an opportunity for a new sportsbook to utilize the space on the Bally’s Atlantic City license.
In its FY Q3 earnings report, the company noted its plans to put the esports betting vertical under strategic review. The company commented on that review in its FY Q4 earnings release:
“The Company implemented a number of initiatives including a reduction of its workforce, the removal of duplicative functions, de-emphasizing parts of the business which do not support its long-term strategic plans, and implementing a more ROI-focused approach to marketing spend, among others. These changes have already resulted in a reduction of the monthly cash burn rate.”
Vie.gg initially obtained its New Jersey betting license in September of last year. It was the first esports-focused vertical to launch in the state. However, with the high cost of licensing (a $100,00 up front fee plus a $100,000 renewal fee), the costs were simply too steep to keep the operation going.
Vie.gg is in a different boat than Fubo, which offered a full-service sportsbook. However, given that Unibet is pulling out of Iowa as well, this does seem to signal a trend of downsizing in the US betting industry as everyone turns their eyes from acquisition to profitability.